Note on Companies Act, 2013

The Companies Act, 1956 is an Act of the Parliament of India, enacted in 1956, which enabled companies to be formed by registration, and set out the responsibilities of companies, their directors and secretaries.

The Companies Act 1956 is administered by the Government of India through the Ministry of Corporate Affairs and the Offices of Registrar of Companies, Official Liquidators, Public Trustee, Company Law Board, Director of Inspection, etc. The Registrar of Companies (ROC) handles incorporation of new companies and the administration of running companies. Since its commencement, it has been amended many times, in which amendment of 1988, 1990, 1996, 2000 and 2011 are notable.

The erstwhile Companies Act 1956 (the ‘1956 Act’), which had been in existence for over fifty years, appeared to be somewhat ineffective and restricted at handling and governing some of the present day challenges of a growing and developing industry and the interests of an increasing class of sophisticated stakeholders. And as a result of the ever changing business scenario and dynamic corporate environment Companies Bill, 2013received the assent of Hon'ble President of India on 29 August 2013 and came into force on 12 September 2013. It is an Act of the Parliament of India which regulates incorporation of a company, responsibilities of a company, directors, and dissolution of a company. The 2013 Act is divided into 29 chapters containing 470 clauses as against 658 Sections in the Companies Act, 1956 and has 7 schedules. The Act has replaced The Companies Act, 1956 (in a partial manner) and it also brought about some drastic changes in several areas of company administration and management.

The main objective of this paper is to make a comparative analysis of some of the major changes brought in to the corporate law and its governance by the Companies Act, 2013 with respect to corresponding sections of Company Law, 1956.